Thursday, February 02, 2012

The media is attacking Romney now in a bald attempt to prop up Gingrich, because Gingrich can be beaten. If Newt ever were to get the nomination, the drumbeat would sound, you can here it now: Obama is a 'family man' and Gingrich is a 'family destroyer.' They will say that Gingrich is a right-wing flip-flopping egomaniac control freak. They will then compare that to the 'New Obama' a moderate who's plan for hope and change is succeeding so we should 'stay the course.'

Consider the experience of UniMac, a laundry-equipment manufacturer in Marianna, Fla. UniMac plays a prominent role in When Mitt Romney Came to Town, a 28-minute documentary heavily promoted by the pro-Gingrich PAC Winning Our Future. According to the film, Bain Capital took over UniMac and wrecked it. If you believe the ominous narration, Bain’s managers fired workers such as Mike Baxley and Tracy and Tommy Jones as they slashed costs and eventually shut down the plant. According to a report by Elizabeth Williamson in the Wall Street Journal, however, the three employees actually flourished and were promoted under Bain. Only after Bain sold the plant to the private-equity arm of a Canadian teachers’ union did the plant close. After that shutdown, UniMac’s operations shifted not to some emerging-market sweatshop but to Ripon, Wis. The three workers parlayed their experience at UniMac into a new washing-machine sales-and-service business. Far from being crippled by UniMac’s demise, the workers upgraded their skills and plunged into the new entrepreneurial economy.

Getting back to the issue, after dispensing with the crap. . . the basic charge is that Romney is a successful capitalist, and that through Bain he created wealth for himself. Guilty! He's an American Success. But there is so much more to the story. As a venture capitalist, Romney created thousands of jobs:

Among Bain Capital’s investments under Romney, the large job creators are clearly Staples and Sports Authority. Both of these were small, young companies when Bain Capital invested in them. Bain invested in Staples when it had only one store, so there were likely fewer than 200 employees at the time. Bain appears to have invested in the Sports Authority when it had fewer than ten stores. Unfortunately, there are no public data to say how many people were employed at that time. At the end of 1998, Staples had more than 42,000 employees, Sports Authority had almost 14,000, Gartner Group had almost 3,000, and Steel Dynamics had over 500. So at the beginning of 1999, when Romney left Bain Capital, these four companies alone employed almost 60,000 total employees. While some of the job growth at Sports Authority came from acquisitions, there is no doubt that these four companies created tens of thousands of jobs over the period.

Fast forward to today. By the end of 2011, Staples had about 89,000 employees. Sports Authority is now a private company. The last time it reported employee numbers, in 2006, it had 14,300 employees. In addition, Gartner Group had over 4,400 and Steel Dynamics had over 6,000 employees. Using the most recently available data, these four companies alone employed almost 125,000 total employees.

A Wall Street Journal article mentions four companies--American Pad & Paper (Ampad), Dade Behring, DDI, and Stage Stores--that Bain Capital made very profitable investments in and took money out of; later, the companies went bankrupt. What the article does not tell you is what happened before and after those bankruptcies. When you add it all up today, even in these investments, it looks likely that Bain Capital created jobs overall.

Congress has held since the 1970s that carried interest deserves to be taxed at a lower rate because it is at-risk capital that only materializes if a fund invests wisely, and because when you tax something--such as risk taking--you get less of it. Mr. Romney didn't write this "loophole." He is merely following the law that Senate Democrats like Chuck Schumer have spent years protecting.

For every dollar of venture capital invested from 1970 to 2010, $6.27 of revenue was generated in 2010.

Annual venture investment equals less than 0.2 percent of U.S. GDP.

Annually, VC-backed companies have generated revenue equal to 21 percent of U.S. GDP.

Romney has experience living and creating jobs for the American Dream. Comparing Romney to Obama we find that Obama wants to remake America in his dream, rather than create opportunity, he will continue to destroy opportunity in his quest for increased government control of capital. Liberals want an inefficient government to allocate capital, according to their whim.

So far as we know, everything Romney did was legal. All participants invested in Bain voluntarily--because Romney had good ideas. Letting the media excoriate him for it, while ignoring rich Democrats, Cabinet appointees who haven't paid their taxes and a President who seems stuck on "pass this jobs bill," is discriminatory bias. Allowing Obama to continue to loot the taxpayers to fund progressive whims and destroy the American Dream is a reason to vote him out of office this November.

Barring some paradigm changing event, for the independents who decide the winner, this election will be another "it's the economy, stupid" in which jobs and the economy are the sole issues of importance.

J.E. Dyer's take on Romney is astute; "The reason Romney hasn’t had that much real political success is that he doesn’t have much in the way of a political philosophy. When political conditions are set for him by outside agency, he’s an effective manager. His admirable record at Bain, and his achievement in organizing a faltering Olympics for success, attest to that. But his record as governor of Massachusetts indicates that in a political role, he accepts existing conditions as given, and seeks merely to optimize certain narrow priorities within them."

Therein lies the conundrum of Romney's candidacy; he'll revive the economy, take seriously the Islamic threat but do little to reverse the socialistic path our nation is upon.

There are plenty of wealthy politicians, including Hillary Clinton ($30M), John Kerry ($240M), John Edwards ($50M) and Obama's entire cabinet. Why didn't they get the water boarding treatment the press is giving Romney?

Moreover, look at how those politicians got their money.1) Ambulance chaser: John Edwards2) Married into money: John Kerry3) Made money off one's political name: Hillary Clinton.4) Used political push to increase fortune- investing where one voted- Nancy Pelosi5) Made it on his own, investing in companies that increased jobs [e.g., Staples]: Romney.

I really don't think there's any chance at this point that Romney doesn't get the nod. At this point, it's more a question of who will have the pull to get the Veep nod, and which would do the best at it, and bring the most positive votes to the polls in November -- Santorum or Newt.